Tuesday, August 17, 2010

Update on The Ultimate Momentum Signal - 18th Aug. 2010

 Another Day of Flat Trading ... !!!

Yours truly is at a loss on what to write about the trading these days. All right, here it is ! The Nifty futures opened flat, traded flat in  a narrow range and closed flat on Tuesday. 

Here are some random observations too ! The Nifty futures tested the day's  low of 5410 twice during the day. The second test happened  later in the day when the European markets were rallying. The test of the low seems to have failed, at least for the day, and therefore, it may try to test the highs once again. The late strength in the international markets seems to support this opinion too. Here is the follow up on the reported  uptrend seen in the true ranges which was mentioned in the last post. Well, Tuesday's low range bar seems to have nullified the uptrend in volatility.


 Nifty Futures - Daily Chart  



Updated Momentum Signal Spreadsheet

The updated spreadsheet showing the Momentum Signal as at the close of the trading on  17th August, 2010 is given below : 


The Nifty future and the underlying index have closed in the sell territory as per the Momentum Signal system. 
( Please also read the last parts of these post describing the limitations of the system in dealing with ranged markets. )


Projected Momentum Signal Close Values

The projected levels Momentum Signal values applicable to various ranges of closing values of the Nifty Futures, Nifty Index and the BSE Sensex,  as at the close of next trading day, ie. as on  18h August, 2010, are given in the following table. 
 
 
 Please click on the table to enlarge. For more info on the above table,  please click here.  
 
As matter of abundant caution, it is reiterated that the market is still range bound by all effects and therefore, the risks of the system indicating whipsaw signals are extremely high. 
 
"Readers of this blog may please note the following  'Risk Factor' which is being  repeated almost daily these days. The markets are trading in small ranges at the top end of a slow climb and for all practical purposes the trading is range bound. Range bound markets are not suitable for the  profitable trading of the Momentum Signal system."
 
"As the Momentum Signal is primarily a trend following system, it may indicate whipsaw signals in range bound markets. As such, all readers of this blog are requested to read the various pages describing the system and understand all the intricacies of trading the Momentum Signal and it's risk factors too. Please do write in your comments and suggestions."

Cheers and Prosperous Investing and Trading !!!

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To checkout the five year history of The Momentum Signal Spreadsheet click here
 
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